US STOCKS-Wall St gains after court blocks most Trump tariffs

By Shashwat Chauhan and Kanchana Chakravarty

May 29 (Reuters) - Wall Street's main indexes rose on Thursday after a federal court ruled against most of U.S. President Donald Trump's tariffs and AI bellwether Nvidia reported a 69% surge in quarterly sales.

Nvidia NVDA.O jumped 5% after reporting higher-than-expected quarterly sales growth, driven by customers stockpiling AI chips ahead of U.S. export restrictions on China.

The company, however, warned that the new curbs are expected to cut $8 billion from its current-quarter sales.

"We're in a secular growth trajectory here for AI, AI investment, and everything seems to be lining up for the next kind of multi-quarter expansion across AI," said David Russell, global head of market strategy at TradeStation.

The Philadelphia SE Semiconductor index .SOX rose in the wake of Nvidia's results, last up 1.4%.

Eight of the 11 major S&P 500 sub-sectors rose, with information technology .SPLRCT and consumer discretionary .SPLRCD being the biggest gainers.

Global risk appetite was boosted after a U.S. court invalidated with immediate effect most of Trump's sweeping levies imposed since January, but did not address some industry-specific tariffs on automobiles, steel and aluminum.

"Even if the ruling is upheld, the administration will have alternative routes to implement tariffs. But these will be slower and more targeted, as opposed to the current sweeping approach," said Lizzy Galbraith, senior political economist at Aberdeen.

Kevin Hassett, the White House economic adviser, said three trade deals were nearly done and he expected more despite the judgment.

At 9:47 a.m. ET, the Dow Jones Industrial Average .DJI rose 51.16 points, or 0.12%, to 42,149.86, the S&P 500 .SPX gained 32.60 points, or 0.55%, to 5,921.01 and the Nasdaq Composite .IXIC gained 173.41 points, or 0.91%, to 19,273.71.

Dow component Salesforce CRM.N weighed on the index, with its shares slumping 5.4% even as the enterprise software provider raised its annual revenue and adjusted profit forecasts.

Apple AAPL.O, which Trump threatened with tariffs last week, rose nearly 1%. Tesla TSLA.O rose 2.2% and Amazon AMZN.O added 1.2% among megacap and growth stocks.

The S&P 500 is currently about 3% below an all-time high touched on February 19, rebounding from a nearly 19% decline earlier in April on easing trade tensions, strong earnings and subdued inflation data that aided risk appetite.

May has been a solid month for equities, with both the S&P 500 .SPX and the Nasdaq .IXIC on pace for their best monthly performances since November 2023.

A second reading from the Commerce Department showed gross domestic product contracted 0.2% in the first quarter. Economists polled by Reuters had forecast a 0.3% contraction.

At least five Fed policymakers including Fed Board Governor Adriana Kugler are scheduled to speak through the day.

In other earnings, Best Buy BBY.N dropped 7.5% after the electronics retailer lowered its annual comparable sales and profit forecasts amid concerns that U.S. tariffs would weigh on consumer demand for big-ticket items.

Advancing issues outnumbered decliners by a 2.63-to-1 ratio on the NYSE and by a 1.73-to-1 ratio on the Nasdaq.

The S&P 500 posted five new 52-week highs and no new lows, while the Nasdaq Composite recorded 25 new highs and 23 new lows.